Madhya Pradesh H.C : Whether, on the facts and in the circumstances of the case, the Tribunal was justified in quashing the order of assessment passed by the ITO, Special Investigation Circle-I, Indore, on August 23, 1980, as void ab initio on the ground that the IAC(Assessment), Indore, had no jurisdiction to give directions to the ITO, Special Investigation Circle-I, Indore, under s. 144 B of the Act ?

Counsel Appeared

Rawat, for the Revenue : M.S. Choudhary, for the Assessee

G. SOHANI, ACTG. C. J. :

This is an application under s. 256 (2) of the IT Act, 1961 (hereinafter referred to as ” the Act “). The material facts giving rise to this application, briefly are as follows The assessee is assessed in the status of a registered firm and the assessment year in question is 1976-77. The case of the assessee was earlier within the jurisdiction of the ITO, B-Ward, Bhopal, who had forwarded the draft of the proposed order of assessment together with the objections of the assessee to the IAC, Range-1, Bhopal, as required under s. 144B of the Act. During the pendency of this reference, the case of the assessee was transferred by the CIT under s. 127 of the Act to the ITO, Special Investigation Circle-I, Indore. The IAC, Bhopal, forwarded the draft assessment order along with the objections of the assessee to the IAC (Assessment), Indore, for issuing necessary directions under s. 144B of the Act. The IAC, Indore, accordingly, issued directions and on receipt of these directions, the ITO, Special Investigation Circle-I, Indore, passed the assessment order. The appeal preferred by the assessee was rejected by the CIT (A). On further appeal before the Tribunal, the Tribunal held that the IAC, Indore, had no jurisdiction to issue directions under s.

144B of the Act. In this view of the matter, the Tribunal quashed the order of assessment passed by the ITO, Special Investigation Circle-1, Indore. Aggrieved by the order passed by the Tribunal, the Revenue sought reference, but as the application made in that behalf was rejected by the Tribunal, the Revenue has filed this application.

2. Having heard learned counsel for the parties, we have come to the conclusion that the following question of law does arise out of the order passed by the Tribunal :

” Whether, on the facts and in the circumstances of the case, the Tribunal was justified in quashing the order of assessment passed by the ITO, Special Investigation Circle-I, Indore, on August 23, 1980, as void ab initio on the ground that the IAC(Assessment), Indore, had no jurisdiction to give directions to the ITO, Special Investigation Circle-I, Indore, under s. 144 B of the Act ? “

3. The application is, accordingly, allowed. The Tribunal is directed to state the case and to refer the aforesaid question of law to this Court for its opinion. In the circumstances of the case, parties shall bear their own costs of this application.

[Citation : 179 ITR 461]